At the same time, many multinationals with exposure to the slowing global economy are among the dozen Dow components and 80 S&P 500 companies reporting earnings. General Electric, IBM, Microsoft, Intel, Citigroup, McDonald's and Coca-Cola are among them.

"The election seems to come and go in terms of its impact. The tendency of the market is to trade with earnings, " said Gina Martin Adams, institutional equities strategist at Wells Fargo Securities. "I think earnings are still the driver of stocks despite the fact we like to get distracted by all these policy measures. While the election on any given day will be a focus, it's really all about earnings. There obviously is a connection between the election and earnings because the winner can affect policy. For now, we'll go with what the companies are telling us."

But analysts are also watching to see how Romney fares in the debate after he was viewed as the clear winner in the first one. Since then, his poll numbers have matched and even in some cases surpassed President Obama, and stocks and sectors that would perform better with Republicans in the White House have also done better. (Read more:Stocks That Favor GOP Victory See Post-Debate Boost )

"If Romney puts in a good showing, it's definitely going to help the market, " said Thomas Lee, J.P. Morgan chief U.S. equity strategist.

"I think everyone is betting on an Obama re-election as the base case right now, but definitely a Romney victory would affect how corporates might feel, " said Lee, adding they favor Romney's approach on taxes. "If Romney wins, people have to become more invested. People are cautiously positioned now."

Companies, so far, have been signaling that a weaker global economy is stealing their earnings thunder. Based on actual earnings for companies that have already reported and estimates for those expected to report, third-quarter earnings will be down 2.6 percent, according to FactSet. Five of the 10 S&P industry sectors are expected to report a decline in earnings growth, led by materials and energy, while eight of the 10 sectors are expected to report revenue growth. (Read more: Fourth-Quarter Earnings Warnings Start Rolling In )

"This quarter should be the first quarter in five in which the mega-caps underperform the index, so that will be tested next week, " said Adams. "It's a pretty big mega-cap week with all these big names. Without the support of the mega-caps, the earning season could be even more negative than expected. You get a couple of big misses and suddenly you're looking at a much worse season."

For that reason, Adams said she's relying on stocks that generate earnings domestically. "I've been overweight consumer as well as health care. I've been playing the domestic theme all year because they tend to benefit from domestic growth. My call has deteriorated from one of optimism to one of hiding from the storm of earnings because the earnings situation has deteriorated so much, " she said.

Stocks , in the past week, turned in their worst performance since the beginning of June. The Dow was down 2.5 percent to 13, 328, and the S&P 500 fell 2.2 percent to 1428. Nasdaq fell 2.9 percent to 3044. Treasury yields fell, with the 10-year yield finishing Friday at 1.66 percent. Oil gained nearly 2.2 percent to $91.86 per barrel for the week, as Mideast tensions flared.

Besides earnings and the election, there is a series of important economic reports, including the Philadelphia Fed and Empire State surveys that will give a first look at how October is faring. Retail sales Monday should provide more insight into the consumer, after Friday's consumer sentiment number saw a surprising jump to its highest level in five years. China also releases data this week, starting with Monday's inflation reports. Then on Thursday, China releases industrial production, retail sales and GDP.

"I think we're seeing what we already know, which is the U.S. economy has been holding up while the global economy has really weakened over the last few months. I think earnings are only telling us that and reinforcing it, " said Lee.

Econorama

There are also a number of U.S. housing-related reports, including builder sentiment Tuesday; housing starts Wednesday and existing-home sales Friday. Housing has been the one data series that has shown improvement.

Adams said housing-related stocks are also one of the favorite plays of investors focused on domestic stocks. "Obviously the home builders are the first group that come to mind and those are fairly volatile and pricey options. There are other peripherals to play housing — consumer durables. Some of the specialty retailers have exposure to housing. Usually autos tend to trade in line with housing, but for most of this year the auto sector has done poorly, and a lot of the consumer space tends to benefit when housing benefits, " she said.

Lee said it appears consumers are feeling better because of the improvement in housing, but also the stock market, with the S&P 500 up 14 percent year-to-date. JP Morgan crunched the numbers and determined the gains in housing prices in 2012 amount to $1.7 trillion and the gain in stocks is $3.6 trillion, for a total $5.3 trillion, the biggest gain in household wealth ever. The increase in housing prices does not nearly match the steep decline, but it is the first increase since 2006.

"It explains why consumer confidence keeps going up. Consumer sentiment hit a new high today. It's not because jobs are picking up, " he said. Consumers spend more when they see asset values rise. "Historically five percent is spent in the following 12 months … The spending effect would be about $260 billion on incremental spending, " Lee said.

The improvement in consumer confidence may actually be something that helps President Obama, according to Dan Clifton, head of policy research at Strategas. He said the economic numbers were hurting the president until recently, and the race is now too close to call. He said the surprise decline in the unemployment rate to 7.8 percent was helpful to Obama because based on history, the president needs 7.6 percent unemployment to get 50 percent of the vote.

"The University of Michigan consumer sentiment is a great predictor of presidents getting re-elected, " Clifton said. Sentiment jumped to 83.1 Friday, close to the 83.5 level Clifton said the president needs to be re-elected. "It's been sitting at 72 all year, hanging out at Jimmy Carter and George Herbert Walker Bush levels — two guys that lost."

Europe will also stay in the headlines in the week ahead. There is an EU summit Thursday and Friday, at which leaders are expected to discuss budgets and tighter financial integration. Lee said Europe is making progress and beginning to stabilize, and that should help markets.

"We're getting the bad news in front of us, and out of the way and then we can focus on what's going to drive forward growth, " he said. "I think earnings revisions are going to turn positive soon. I think Europe is stabilizing and the U.S. demand story is better."

Adams, however, said she's concerned about what companies will say about future quarters when they report earnings. "What started in Europe became China's problem which is now our problem. It's a generalized slowdown and the only thing that seems to have improved modestly is the housing market and everything else seems to have slowed. It's fairly broad-based, " she said.

The fourth-quarter expectations for earnings per share imply a 16.5 percent increase year-over-year. While some of that is due to the easy comparison from last year, it still may mean estimates have to come down, she said.